Two Northwest commercial community banks are merging. West Coast Bancorp of Lake Oswego and Columbia Banking System of Tacoma, Wash., announced the merger Wednesday.
The transaction is expected to be completed early next year, after approval from shareholders and regulators. West Coast has 58 branches in Oregon and Washington. Columbia has 76 branches in Washington and 25 in Oregon under the Bank of Astoria name. The combined company will have approximately $7.2 billion in assets with over 150 branches throughout Washington and Oregon and will rank number 1 in deposit market share amongst commercial community banks in the combined states of Washington and Oregon.
"We are very pleased that West Coast has agreed to join and grow with Columbia," said Melanie J. Dressel, President and Chief Executive Officer of Columbia. "We see this as an exciting opportunity for both companies, our shareholders, customers and employees to create the Premier Community Banking Franchise in the Pacific Northwest. On a combined basis, we will have extensive coverage throughout Washington and Oregon, including serving all major MSAs."
Robert D. Sznewajs, President and Chief Executive Officer of West Coast commented, "This merger is a rare fit of two high quality organizations with similar business models, cultures and values. We think the transaction will provide outstanding benefits to our customers, communities, shareholders, and other constituencies, along with enhancing our proven approach to community banking."
The merger is expected to be immediately accretive to Columbia's earnings per share with an IRR in excess of 15%. Anticipated cost savings are expected to be approximately 25% of the operating expense base of West Coast, with 50% being realized in 2013 and 100% being realized thereafter.
The transaction is expected to be completed in the first quarter of 2013, after obtaining the approval of the shareholders of each company and receipt of necessary regulatory approvals. The agreement was unanimously approved by the Board of Directors of each company. In addition, shareholders of West Coast owning or controlling approximately 22% in the aggregate of the currently outstanding shares of West Coast have already agreed to vote in favor of the merger.
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